Today, there is a lot of buzz around the upcoming dLocal IPO. Yesterday, dLocal reportedly finalized its pricing range for what will become DLO stock on the Nasdaq Exchange. It’s expected that dLocal will publicly trade on Thursday, June 3.
The cross-border payments provider helps domestic companies reach emerging markets. Traditional fees for cross-border payments have become a sticking point for companies focused on growing margins. Accordingly, it’s unsurprising dLocal has been able to see fast growth in this global hyper-growth space.
Indeed, dLocal’s current customer base has provided the impetus for what appears to be strong demand for this IPO. The company services mainly large merchants with extensive operations in emerging markets. Customers include the likes of Amazon (NASDAQ:AMZN), Microsoft (NASDAQ:MSFT) and Spotify (NYSE:SPOT). dLocal saves these companies significant amounts of money on foreign conversion fees. The company rakes in a smaller cut of each transaction than what customers would see from traditional cross-border service providers.
With low-fee options becoming increasingly popular in today’s world, dLocal’s business model is one investors are looking to for growth now. Let’s take a look at some of the details of this pending IPO to see why investors are getting so excited on this name right now.
dLocal IPO Drawing Significant Interest
On Monday, the Ripple client dLocal set the range for its offering at $16 to $18 per share, according to the company’s prospectus. The company will offer 29.4 million shares at this price, and stands to raise more than $608 million at the upper end of its range.
Additionally, this IPO could value the company at as much as $5.7 billion. It remains to be seen what the final offering price will be. However, initial demand appears to be strong for this listing. Fidelity Management & Research is reportedly looking to acquire 20% of the stock sold at the IPO.
Underwriters on the deal include JPMorgan Chase (NYSE:JPM), Goldman Sachs (NYSE:GS), Citigroup (NYSE:C) and Morgan Stanley (NYSE:MS).
Where this IPO ultimately trades remains to be seen. However, it’s clear there is a tremendous amount of interest in dLocal. Accordingly, I wouldn’t be surprise to see DLO stock trade near the higher end of its range.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.
